Sanoma Corporation, Stock Exchange Release, 22 March 2013 at 8:45 CET+1
Advertising markets in Sanoma’s main operating countries are more depressed than expected. In addition, price increases, bundles and digital offerings are not able to fully offset the decline in circulation sales.
The ongoing EUR 60 million gross savings programme is proceeding according to the plan. The programme and additional actions initiated because of the changed environment are not able to compensate for the estimated decline in net sales.
Therefore Sanoma has taken a more cautious view for the year and revised its outlook for 2013.
Group outlook for 2013 (revised)
In 2013, Sanoma expects that the Group’s consolidated net sales will decline by 2 - 4% compared to 2012 and operating profit excluding non-recurring items is estimated to be EUR 180 - 205 million.
Sanoma’s revised outlook is based on the assumptions that the European economic environment remains subdued and advertising markets remain depressed in Sanoma’s main operating countries.
The first quarter for the Group is seasonally the weakest. In addition, Sanoma will invest materially in the Dutch and Finnish TV operations as well as digital development. Hence the operating profit excluding non-recurring items will be negative for the Group in the first quarter.
Changes in market environment and weakened outlook for underlying businesses triggered an impairment test. As a result, Sanoma has taken a non-cash goodwill and other intangible asset impairment charge on the Group level of EUR 34.8 million in Sanoma Media Netherlands, that comprises Sanoma’s Dutch magazines, TV and online operations. The impairment charge will be reported in Sanoma’s first quarter consolidated financial statements, and classified as non-recurring item, with no effect on cash flow.
In the local statutory accounting, the legal entity Image B.V. (SBS Netherlands) will recognise non-cash goodwill and other intangible asset impairment charges on Image B.V. level totalling EUR 392 million, of which EUR 201 million based on impairment tests in 2012. The impairment in Image B.V. has no additional impact on Sanoma Group’s financials.
Invitation to conference call
A conference call will be held in English by President and CEO Harri-Pekka Kaukonen and CFO Kim Ignatius today (22 March 2013) at 11:30 CET+1. Dial-in numbers are +358 (9) 23 195 185 and +44 (0) 1452 552 870.
Sanoma's Investor Relations, Martti Yrjö-Koskinen, tel. +358 40 684 4643 or email@example.com
For media inquiries, please contact Sanoma Group Communications, Robin Janszen, tel. +31 6 2293 2643 or firstname.lastname@example.org
For media inquiries in Finland, please contact Sanoma Group Communications, Hanna Johde, tel. +358 40 673 8977 or email@example.com
Sanoma inspires, informs and connects. Sanoma is a leading European group with a focus on consumer media and learning. We bring information, experiences, education and entertainment to millions of people every day. We employ over 10,000 professionals in some 20 countries. In 2012, the Group’s net sales totalled EUR 2.4 billion. Sanoma’s share is listed on the NASDAQ OMX Helsinki.